New buyer demand for housing in Northern Ireland rose at the fastest rate since the beginning of 2022 according to the latest RICS and Ulster Bank Residential Market Survey, and NI respondents are more optimistic than they were about the short-term sales outlook.
A net balance of 35% of NI respondents reported that new buyer enquiries rose through the month of January, the fifth consecutive month that this balance has been in positive territory. This is the highest that this figure has been since January 2022.
Looking at sales levels through January, a net balance of 12% of NI surveyors saw a rise in sales through the month. This remains relatively unchanged from the figure that was seen in December.
However, with increased new buyer demand, respondents are more optimistic about the outlook than they were. A net balance of 34% of surveyors in NI anticipates that sales will rise over the next three months. This is compared to the 23% that was seen in December 2023. NI respondents are more optimistic than UK counterparts with a net balance of 14% of UK respondents expecting an increase in sales.
In regard to supply, a net balance of 24% of surveyors in Northern Ireland said that new instructions to sell rose through January. This is the fifth consecutive month that this figure has remained in positive territory.
Looking at pricing, a net balance of 59% of NI respondents reported that prices rose over the past three months, up from 53% that was seen in December 2023. On the pricing outlook, a net balance of 32% of respondents anticipate that prices will continue rising over the next three months.
Regarding the year ahead, Northern Ireland surveyors’ expectations remain firmly positive. A net balance of 67% of NI respondents expects prices to be higher in a year’s time. The next highest figure is for both London and Scotland at 46%. A net balance of 40% of Northern Ireland respondents expects sales activity to higher in a year’s time.
Samuel Dickey, RICS Northern Ireland Residential Property Spokesman, says: “It’s encouraging to see that surveyors in NI are remaining optimistic. The easing in mortgage rates has no doubt alleviated some of the pressures seen in the housing market, and this is perhaps why we’re seeing some increased demand. And Northern Ireland respondents are still more confident about prices over the next 12 months than their counterparts elsewhere in England, Scotland and Wales, anticipating some upward movement.”
Terry Robb, Head of Personal Banking at Ulster Bank, added: “2024 began with good demand through January and we expect that this will continue in the coming months. Ulster Bank remains strongly committed to supporting homebuyers and remortgagers in 2024. We recently reduced the rates on our new business and existing customer product ranges, which included rate reductions on two and five year deals for purchase and remortgage, as well as on our green mortgages. There continues to be a wide range of mortgage borrowers who want to buy their first home, move house, or remortgage, and it’s important that they continue to be able to avail of mortgage products that meet their needs.”
Commenting on the UK picture, RICS Senior Economist, Tarrant Parsons, said: “The UK housing market has seen a continued improvement in buyer activity through the early part of the year, supported by the recent easing in mortgage interest rates. Although sales volumes through much of the year ahead are likely to remain relatively subdued compared to the longer-term average, the outlook has now turned modestly brighter on a consistent basis over the past few survey reports.
“However, this is not to say that mortgage affordability isn’t still a significant challenge, and any further unwelcome surprises with regards to inflation may still cause interest rate expectations to be revised. That would then pose a significant risk to any prospective recovery in the months ahead, even if the current prognosis is for the market to see a further pick-up in activity levels.”